central bank’s independence and stock prices中央银行的独立性和股票价格.pdfVIP

Modern Economy, 2012, 3, 793-797 /10.4236/me.2012.36101 Published Online October 2012 (http://www.SciRP.org/journal/me) Central Bank’s Independence and Stock Prices 1 2 3 Yutaka Kurihara , Koichiro Morikawa , Sadayoshi Takaya 1Faculty of Economics, Aichi University, Nagoya, Japan 2Faculty of Economics, Kinki University, Higashiosaka, Japan 3Faculty of Commerce, Kansai University, Suita, Japan Email: kurihara@vega.aichi-u.ac.jp Received September 13, 2012; revised October 13, 2012; accepted October 20, 2012 ABSTRACT Since the end of 1990s, the independence of central bank independence has been discussed. In the past, central banks tried to improve their independence to combat inflation. This independence has been evaluated relative to adequate economic policy and stable economic growth. This article examines the effect of central bank independence on stock market prices and finds evidence for a positive return in developed countries; moreover, for stock prices, economic in- dependence of the central bank seems to be more important than political independence. Keywords: Central Bank Independence; Monetary Policy; Stock Price 1. Introduction pirical analysis sometimes causes problems as these es- tablished papers provide fixed data for some sample An independent central bank is considered necessary for period